Skip to main content

tv   Squawk on the Street  CNBC  January 26, 2010 9:00am-11:00am EST

9:00 am
tomorrow's "squawk box" live from davos. becky is in switzerland holding court with the most powerful business leaders. conversations you can't afford to miss. let's go "around the horn" with final thoughts. "the science times" is my favorite, really the best part -- >> yeah, we can agree on that. >> we love "the science times." they interesting show tectonic plates down in haiti and there are other fault lines down there and it's scary. >> speaking of fault lines, the implication on bernanke. is it really a smoking gun memo out there. >> let's suggest.
9:01 am
>> let's look at one more old picture and we'll pick that up why he's talking about what is your final thought, gary. >> do you remember what stock i mentioned. two stocks i mentioned on that show. >> apple computer? >> no. >> bay banks -- >> and suncorp. >> in '95 you were mentioning sun corp. >> that was a home run. not lyiike anything now. >> my quick thought the markets look exhausted, good earnings, baked in. we have a doth of of buyers. >> it was darth vader. >> dirth. >> no, it's darth vader. >> what do you have coming up on "squawk on the street." >> lots of stuff. tune in. >> i love focusing on this. happy to be with you. look forward to being back soon. >> yes. >> nice hair, by the way. >> thank you. make sure you join us -- becky will be in davos tomorrow. "squawk on the street" is coming up next with david.
9:02 am
all right. we begin with breaking news. s&p, case-shiller's latest report showing -- actually, we're not show what it shows, mixed messages maybe but the annual rates of decline in u.s. home prices stressed at the rates of decline. still declining. but they're continuing to improve. >> right. joining us to talk about it right here as the new crosses, david blitzer, chairman of the s&p 500 index committee. david, we appreciate you taking the time. this number goes through november. we'll talk in a moment about why that is significant. but what would you say overall? still as hark himark highlighte improvement at the rate of decline. is that the best we can do? >> just about the best we can do. this is somewhat of a mixed report. on the good side, california looks a whole lot better and california is a huge chunk of the housing market.
9:03 am
and it has been a very large piece of the difficulties and problems in the housing market. and the three cities we tracked, san diego, los angeles, and san francisco all showed some improvement month to month and california feels better. we also have four cities that actually showed year-over-year gains, which is the first time that's happened, essentially in modern history. but digging through the report, there are still some very, very weak spots. things like tampa and las vegas are at their lows. new york and chicago both saw month-to-month declines that aren't exactly cheerful. so it is mixed but there are some bright spots. >> dallas, denver, san francisco look like the ones with one-year improvements. yesterday in the home sales data we saw loud and clear people thought the home buyer tax credit was going away for first-time buyers and there was a plunge in sales in december.
9:04 am
do you have any sense what case-shiller will show on that one? >> clearly i haven't seen any data. the reason we have november is it takes a while to compile this and get it right and checked. i would like to have instantaneous data but there are a lot of things we'd like in this world. gentlemen, a sharp drop in existing home sales probably does have an impact. it certainly is not a positive factor for the december numbers we'll see in a month's time. on top of that, foreclosures continue to sort of ripple around the country. foreclosures were probably relatively light in december in part because of a lot of financial institutions, i guess, felt you shouldn't do that in the middle of the holidays. but going forward while we will probably have another bump when the home sales' effort finally ends in the spring, we'll still get bumped up and down by foreclosures for probably all of 2010, if not longer. >> david, i understand the validity of year over year, but it seems to me month to month is
9:05 am
what tells you whether the trend is turning. and as i -- as that list went by, it looked to me that there were only maybe half a dozen places where month to month prices turned up. >> that's right. and that -- to me, that's one of the distressing things. we have seen -- we're not seeing the kind of strength that we saw back in the summer and the fall when we saw substantial majority of cities saying month to month gains. we have some spots of weakness. we have some shifts going on. and it is getting increasingly difficult to say, well, it's straight up from here. >> yeah. >> in fact, it's definitely not. i think we're coming off the bottom as is pretty clear, but this is not a v-shaped recovery in housing. it's up a little and then a lot of creeping. and we're into the creeping game right now. >> okay. david, thank you very much, sir. >> thank you. >> let's hit the markets. we start with cool breeze, bob
9:06 am
pisani, here at the big board. robert? >> good morning, old friend. not a big move here in the futures as as a result of the case shiller numbers. asia saw nice moves here. we had the shanghai markets down 2 1/2% overnight. s&p revised japan's sovereign credit outlook to stable. a lot of big corporations get a big part of their money overseas here. dupont had earnings today. 70% of their sales overseas. very good sales particularly in asia where the recovery is taking hold there. they did raise their 2010 guidance as well. johnson & johnson, they get about half of their top line overseas. again, they also saw very impressive growth overseas. 6.4% overseas, 2.6% growth here in the u.s. very cautious outlook, though, for 2010. delta air lines, very mixed numbers on the airlines. they're down 4%. they reported a greater-than-expected loss but are seeing smaller demand in improvement in the business. trader talk. bertha, how are we looking teg
9:07 am
nasdaq? >> apple extending gains again. it blew away the street when it came to the earnings. bottom line, revenues on the top one. mac sales were especially strong, of course. the second part apple story this week will come on wednesday tomorrow when they're expected to reveal the tablet. the halo effect from happenle, not necessarily glowing over chip stocks. we have applied materials up 1 1/2%. the idc says chip sales in the fourth quarter were at a record. they didn't say what the number was but did say they're up 33% but they think chip sales are back to normal but that does mean they're week and we have chips selling off after leading the charge yesterday. alan pharmaceuticals getting an upgrade over at citi. it's also moving higher on the diabetes move. mike will have nova's ceo in a minute. he will tell you more about that in a few minutes. concerned about china's bank-lending rules definitely
9:08 am
having enough impact on oil prices. what does this mean for energy demand? that is what investors want to know. we are looking at oil prices below $75 a barrel, as we have higher reserve ratios for chinese banks taking effect overnight. we are also looking at the strength in the dollar. it continues to rise here as we speak. that is limited -- showing the limited risk appetite that exists now in the commodity sector. we are looking at the strength in dollar weighing not only on oil and gold. gold prices below $10.90, down nearly $9. silver down even greater. and we'll take a look at what is going on in the commodity sector generally. rick santelli in chicago. >> thank you very much, sharon. quickly, let's talk about the gold. $10.84 to $10.86, technical support. three is the magic number. as far as the dollar, should the dollar index close where it's at up fairly strong at this point, it will be the best close since
9:09 am
september 1st. some of the drivers in this which are, by the way, flattening the yield curve, pushing 10s and 30s down quicker than shorter rates may be the downgrade by s&p of the sovereign credit outlook for japan to a negative outlook. and we have ceos also by s&p downgraded. all of this in the credit scenario continues to be present and accounted for, even with a lot of the work that has been done. mark haines, back to you. >> thank you, rick santelli. here's your check on asia. down across the board except for bombay, which was unchanged. what is going on in europe, you may ask? guy johnson is here with the answer. good morning, guy. >> good morning, mark. we are down again here in europe. the selling just keeps coming on our side of the pond. a few markets in the green but most of the main ones are trading lower at this point. the china story certainly a big factor in that. the other story that's having an
9:10 am
impact on our side of the pond is what is happening with sterling. it took a big hit earlier on in the session. the reason for that, uk gdp coming out today. the uk is finally out of recession but it was only a .1 on the number today. the bank of england is looking for even more than that. the sterling data surprisingly strong. gdp number surprisingly weak. ge's industrial number was good. flipped siemens is delivering out of germany. sthae that sector getting a bit. and john was mentioning exports and that certainly is an impact in that as well. back to you. a basket of diabetes drug stocks are rising and they are led by this one, novo nordis. they are getting approve add for a new type of diabetes drug.
9:11 am
the ceo with us this morning. mike huckman got that interview. he will take it away, mike. >> look at that, the brid asked $3 above yesterday's closing price. the first two quarter's ms drug and now novo nordisk shot for diabetes. three others are waiting fda approval of a similar once a week drug. expect those shares to rally as well. join meg from a cnbc exclusive from copenhagen, denmark, is mr. lars sorenson. thank you very much for being here. >> good afternoon, mike. >> when will you launch this drug in the united states? is your sales force ready to hit the ground running? and which doctors will they be targeting? >> our sales force has been ready for months now. this approval process took somewhat longer than we anticipated. so we'll be launching within weeks. we will start out hitting the
9:12 am
key opinion leaders, specialists and then broaden out gradually to include all gps in the u.s. >> mr. sorensen, which type 2 diabetics can go on victorza? can they be on other diabetes drugs at the same time or do they have to go off them and take it all by itself? >> vivtorza is a second line treatment for individual 2 diabetes that cannot control blood sugar which is on the most commonly used drug. this means that victoza can replace some of the other second line drugs that are currently being used in the u.s. it is an injectable but very powerful blood sugar-lowering drug with a lot of other benefits. >> mr. sorensen, why are you pricing it in line though with a similar twice a day drug called byetta from eli lilly a?
9:13 am
>> we have made an assessment of what an appropriate price would be and we feel this is an appropriate price for a beta product. also, of course, viewing the fact there are competitive products that are going to enter this market in the future, and we need to be competitive, we need to have a strong launch. we think this is good value for money and that's why we picked the price around the current byetta price. >> let's talk about that competition. lilly, amylin are expected to hear from the fda on their similar once a week drug. is your similar market advantage here, if indeed there is one, going to be very short lived? >> well, of course, you would expect me to tell you that we think our product is better than even that of the competition. there are conditions about our product in terms of convenience, in terms of its efficacy and in terms of side effects, which we
9:14 am
believe will belong-acting byet be launched in the future. >> thank you very much, mr. sorensen, joining us exclusiv e exclusivively from copenhagen, denmark. check out more on the blog. and follow me on twitter. these drugs not only lower blood sugar but help people lose weight as well, which is not similar to traditional diabetes drug. >> pretty nice side effect. >> thank you, mike huckman. we're watching apple closely in the earnings central, after a big report last night, shares are up in the free market. plus, the word on the street and case-shiller's effect on home-builder stocks. futures right now or pointing to a lower open. and today's "street poll" is treasury secretary tim geithner, we marked a new way as we phrase this, is it good for your money? that's the question.
9:15 am
we'll be back. [ male announcer ] introducing the all-new lexus gx. it has the agility and the power to take on any mission, and the space to accommodate precious cargo, because every great action hero needs a vehicle. see your lexus dealer. ♪
9:16 am
9:17 am
my little ifp must be set to be ted david. what is it tinitis? >> the face is familiar but i can't face the name.
9:18 am
there were a time the io mmega. >> and the disk drive. >> and they were going to go to a thousand. >> for a while i refer to the enthusiastic apple shareholders, if you switch on it, i called them appleloonians. they were not looney. they were absolutely -- anyone who backed steve jobs is so -- so vindicated and so right at this point. >> and you think back and it was almost a marginalized company. >> $8 billion market. >> look at it now. it's going to move higher, going to open higher from yesterday. 50% profit gain. >> 50%. >> in a year. >> 32% -- >> in a rough year. they sold a third more macintoshes than a year ago. they sold 8.7 million iphones, and that disappointed some people who thought they were going to sell 9 million. >> people who try to take a
9:19 am
futuristic -- to try to describe what apple's able to do, they don't just see demand and satisfy it with a product. they create the demand and then build the product. >> does any company do a product announcement better than apple to create anticipation? >> we'll all talking about it. >> i say take two tablets and buy two stock in the morning. >> what do they earn in a year? let's say we had a panelist on. let's say $16. >> i will have to look it up and see what their profit was. >> it was $3.67 a share. >> so let's say they earn $15. what's it trading at? $12. >> oh, $12. >> if it's growing at 50 times -- if it's going at 50%, nobody's saying give it a 50-times multiple. >> this is a well-priced stock. let's look at travelers. let's call apple a solid double, maybe even a triple in baseball parlance. travelers was a home run.
9:20 am
there you go. the stock will open higher on the home run today. the price up about $2.12. >> revenue also up. revenue also up and above expectations. >> what that red little thing there, the little red carrot. the level up, 11.2% since 2007. johnson & johnson, let's call that a soft single. >> they beat a little. >> they beat the eps but to do that you have to sweat out some items there. >> but they also had a lower tax rate, they talked about that. that helped a lot. they also said they had an extra weak of sales in 2009. and the stock was not called higher. and then verizon in line on the bottom line and slightly below on revenue. but that is going to hurt the dow a little bit today. and then dupont also hurting the dow a little bit, even though that looked okay. 44 cents, 3 cents ahead. >> i call that a solid single. >> better-than-expected results but still indicated earlier.
9:21 am
>> all right, sir. sir forehead. >> it's a reference to the hairline. >> it's a reference -- >> joe, joe? >> yes. >> don't forget krispy kremens. >> oh, yes, yes. >> remember they would send doughnuts to us. >> that company was valued as if it sold every doughnut in the world. >> who had the catalogs on the planes, too? remember that? >> oh, yeah, yeah. >> that's gone. >> and then the disco music we played. >> k-tellians. >> oh, those -- >> i'm not listening to this conversation. >> fond, fond memories. those were the days. >> i tuned out for a second. >> i will not tell you, joe, what you said this morning about it. futures down 4.70. we needed .63. added together, 5.33 fair value. looks like a loss on the doll.
9:22 am
up next "trader's take." and gridlock in washington. mark, have you noticed it takes 60 votes to get anything done in congress? >> i noticed that. not sure how that happened. >> apparently so. we'll be back. tdd# 1-800-345-2550 investors got lost in the shuffle. tdd# 1-800-345-2550 investment firms forgot whose money it is. tdd# 1-800-345-2550 enough is enough. tdd# 1-800-345-2550 it's time investors got what they deserve. tdd# 1-800-345-2550 real help that's there when you need it. tdd# 1-800-345-2550 pricing that leaves you with something to actually invest. tdd# 1-800-345-2550 at schwab, we offer a lot more help for a lot less money. tdd# 1-800-345-2550 because at schwab...
9:23 am
tdd# 1-800-345-2550 investors rule. tdd# 1-800-345-2550 are you ready to rule?
9:24 am
9:25 am
all right. we are back, we are live on the floor of the new york stock exchange. joining me now, alan valdez, famed cnbc commentator with cabrick trading. good morning, mark. >> good morning, alan. >> we are down 4.5. is this a correction? are we going to go 10% down? >> you're right. we're below the 50-day moving average on almost all of the indexes. as january goes, so goes the year. >> yep. >> people are concerned. this is the last day of trading for traders. so you might see a sell-off today also because a lot of guys are just going to dump their stocks. tomorrow, whole new month. we'll see what happens. we have gdp on friday. >> we don't want to wait until tomorrow, alan. we want you to tell us right now what's going to happen. >> right now, i would say, edge down.
9:26 am
look at gold's down, dollar's up. i think we have a lot of pressure on the market today. >> alan valdes, thank you very much, sir. public trading. coming up -- the final countdown to the opening bell. and president obama reportedly about to freeze the budget marcaine. so we will talk about whether this freeze is truly eeze or not wln and whether it will imp our terrible financial situation.
9:27 am
♪ [ male announcer ] introducing the all-new lexus gx. ♪ it has the agility to avoid the unexpected... ♪ ...the power to take on any mission, and the space to accommodate precious cargo, because every great action hero needs a vehicle.
9:28 am
♪ because every great action hero needs a vehicle. bull market or bear, traders are always hungry for ideas. trading is all about strategy. and strategy... is all about information. heat mapping shows me where the money's moving. twenty five hundred stocks... one quick look. that's where the action is. plus, this amazing gadget... it's called the telephone. i can call td ameritrade anytime and talk trades, strategy... anything. td ameritrade. built by traders, for traders.
9:29 am
this is what i need. announcer: trade commission free for 30 days, plus get 100 dollars cash, when you open an account. as we count you down to the opening bell, let's bring in john brady, senior vice president of mf global and pat trader of cardinal capital. pat, headline that's most important is? >> really i think what's going to happen is the biggest thing we're looking at. it's providing a lot of
9:30 am
uncertainty for the market. as we know, the markets don't like uncertainty. as we look at the last week of trading, we see the s&ps down 5%. you look at the vix, it's up almost 40% at that time. a lot of that is the uncertainty of what's going to happen with the fed. obviously, a lot of it to do with the market going down. investors don't like uncertainty that's and that's what we're focusing on. >> what about the good news, apple better than expected, dupont better than expected. boosts the forecast. that stock not looking like it's going to open higher. do people just not care about earnings or what these companies are doing in boosting their forecast just not enough? >> i think certaini inthink ear certainly important. but i think they're taking a back seat. i think the ownership is one part of a complicated picture. you have president obama who may suggest in the coming days they're going to freeze spending in certain parts of the budget. as the public spending sort of contracts, private spending will be expected to increase.
9:31 am
if you subscribing to the economic theory and that could get tricky where we are in the economic cycle. japan's ratings, china slowing their lending growth. there are a lot of international roles that are blowing here. things could get tricky. the key will be watch is the dow and 1065 even, which are up to the pre-bear stern market highs to post-lehman lows. and if we can't hold those, the market could be in tough sledding the next couple of weeks. >> thank you very much. appreciate you both taking the time. at the trade, mark, we'll open in a few seconds. >> here we go. you're watching the opening bill. the new york city federal emergency management agency sponsored urban search and rescue team. that's in recognition for their rescue efforts in haiti.
9:32 am
and at the nasdaq, amcf, china services. we are open, not fully so. down 11. bob is first. >> the important thing is we're opening to the down side. it's the asian action that's mattering at this point. chinese banks went through with their implications from last week, told to officially cool down on the lending. that's affected chinese stocks. they were down about 2 1/2%. and then s&p revised japan's credit outlook from negative to stable. that happened after the market closed but the nikkei over there was still down close to 2% here. the dollar spiked up today. it's at multi-month highs essentially. we see commodities open weaker. i would say down 1% to 3% across the board. more on that in a minute here. multinatural sales and international sales are a very part of these international sales. dupont reported almost 70% of
9:33 am
their top line is overseas right now. they did do a little better-than-expected on the top line, grew better than expected. particularly in asian sales, they raised their 2010 guidance but it's not helping the stock here. johnson & johnson gets half of their sales overseas at this point. their top line was boosted by very strong asian sales. still, they're cautious on their 2010 outlook here. i just want to note here -- and it's just around the corner here -- the liberty media seeking to increase its stake in live nation here to 34.4%. they already own about 14% of that stock. that's moving live nation, waiting for it to open here. bertha? >> we had tech companies put in blockbuster earnings and it's not enough to move the market with all of these other things distracting. apple giving back some of its gains here at the open right now. at 2.05.97. credit squeeze after the blowup quarter from 275 to 250.
9:34 am
again, that's not reflecting against the rest of the big caps we're seeing pretty much 1% decline in a lot of the big names. intel down 1%. dell down .7%. idc folks they say pc demand, computer demand, up 15%. that's a bigger growth than they had seen previously but that's not boosting the stocks. a couple other stocks coming up higher, tell labs, it will be cutting 200 jobs. zion bank corp., a lot of the banks are coming in with smaller losses, although it's the fifth quarterly loss. look at the diabetes drugs, am lynn moving higher on the back of the move by novo. be sure to check out mike huckabee's blogs for more on that. let's head down to sharon. >> a look ahead for the commodity price prices for 2010. about $256 billion went into commodities in 2009. just in the fourth quarter alone, we saw an increase in about $31 billion, the highest
9:35 am
on record there. keep in mind as we look at this influ influx of money into the commodity sector, the returns are not necessarily expected to be what we saw in the year before. we are looking at barclay's latest survey where invetters think they will see the best performance for 2010 and it's no longer gold and crude oil as it was. i'm going to toss it over to hampton pearson now in washington, d.c. for breaking news. >> hello, sharon. we're getting the latest budget deficit projections from the congressional budget office. the official projections are due out at 10:00. but based on leaks, it looks like this. the latest rejections from the congressional budget office, according to reuters, $1.3 trillion versus $1.38 trillion back in august when it took its first snapshot of the budget. one of the things we're looking at in terms of details is what are the projections as well for the out years on the budget for 2015? that new figure is $480 billion.
9:36 am
that's revised downward from $558 billion. beyond the headline number, the one or two things we want to know about these budget forecasts is what is the latest snapshot according to the congressional budget office as far as the cost of health care going forward? but, again, reuters reporting that $1.3 trillion is the latest cbo estimate, revised down slightly from $1.38 trillion back in august. back to you. >> thank you very much, hampton pearson. all right. let's get to rick santelli. >> interest rates are getting a little more active. that makes sense. the coupon refunding kicks off at 1:00 eastern with $44 billion, 2-year notes. and $150 million, 1-month bills, all of these auctions of late, especially bills, have been aggressive. you can look at the news today to see a few reasons why. you still have issues with
9:37 am
portugal, spain, italy, greece and, of course, japan with regard to their sovereign credit outlook being moved to negative by s&p on a watch. if you look at the yield curve, it's gotten more in line. all maturity rates are down four basis points and the market has a lot to deal with. on one hand, some budget cuts being talked about. on the other hand, $80 billion stimulus being talked about. all of these issues, of course, have many various forms that will impact everything from capital markets to what looks like a pretty strong dollar hovering at its best potential closing level since september 1st. mark haines, back to you. >> thank you very much, rick santelli. a quick check on the markets for you. actually, not as bad as the futures indicated might happen at the open. dow down 21 points. nasdaq is down almost half. s&p is also down almost half of 1%.
9:38 am
your "cnbc edge" now with the ceo with highmark capital. and the partner and portfolio manager with douglas c. lane and associates. gentlemen, good morning. thank you very much for being with us. i guess i'll start with david. is this a correction or is it just a two or three-day blip. >> it feels like we keep waiting for a correction. it could happen 10% up from here, which count make any difference. we have a lot of political uncertainty. once we get to the end of this week, we will probably look at i 4% to 5% gdp report for the fourth quarter. as we look forward, we think it should be about earnings. october was a little wobbly. november and december were great. once we got all of the information in, everybody looked at it and took a deep breath and said what are the fundamentals going to look like? we think it is a very strong backdrop for u.s. growth for 2010 going into 2011.
9:39 am
>> no w? >> as we come out of this, there will be political risk but we're probably in gridlock between here and november for now. >> is that a yes or no. >> that is, we think there will be volatility but we want our customers to reengage with the stk. >> okay. sirott, what do you think, correction or not? >> i think we're in the middle of what i would say is a correcting period, 5% or 10%. market's not going to go anywhere. i think within the market is where you have the opportunities. what happens is the stock prices now have -- earnings have caught up with stock prices. so really fundamentally the areas of the market that really shouldn't be there, ie cyclicals that are forecasting a much better growth. you mentioned 4% gdp. that's what some of these companies are forecasting for the next year. we don't think that's correct. we think it's more like 2% to 3% and really the growth will be in specific areas where you want catalysts for stocks. >> david said 4% to 5%, didn't you? >> for the fourth quarter. >> we're expecting 3%.
9:40 am
>> that's optimistic. >> that's a half percent better than -- than what the consensus is expecting. >> right. >> i'm just curious because we keep pumping money into this system and it's hard not to believe that, that has inflated asset prices. you could say it hasn't artificially inflated them but at some level you have to go back to the fact incomes have not gone up and asset prices have not fallen as far as they otherwise would have if we didn't have this unprecedented money printing going on. how do you come to the conclusion we do not still have a bubble? >> i think it's important to figure out what is the right price for where we are. stock prices have gone up a lot, up 67% off the low from last year. but we haven't gotten back to fair value yet because we had such a correction in 2008. we still have a lot of skepticism and fear in the market. so we still have not gotten to full realization. if we gotten too far, too fast? put a cap and you get 1425. there's upside in terms of valuation for the stock market.
9:41 am
>> gentlemen, thank you very much. we have to quickly go to mike huckman, who's got breaking news. michael? >> good morning, mark. "the wall street journal" is reporting that swiss drug giant novartis has agreed to a plea deal with the u.s. attorney's office in the eastern district of pennsylvania regarding the marketing of a relatively small-selling drug for epileptic seizures and as a result the company has agreed to pay a $185 million fine but it is also reportedly set aside nearly $400 million in connection with this investigation that also reportedly includes probes into the marketing of as many as five other novartis drugs. this is a lot of money, $185 million but it is relatively small compared to recent similar settlements by the likes of pfizer, lilly and as stra zen c astrazeneca. but novartis agreeing to pay a
9:42 am
$185 million fine for approving an epileptic drug for uses it was not approved for. let's go to steve. the imf is upgrading its forecast for 2010. that's up 0.8%. that's a sharp upgrade as these things go. for 2011, up a tick but it's the 2010 where the news is. there's also news as far as the forecast for the u.s. they're saying 2.7% growth for 2010. that's up 1.2%. that's as sharp as anybody else they upgraded here. although for 2011, they're downgrading the forecast. upgrading the growth forecast for all major countries in economic regions in the new economic outlook that it published this morning. here are the extremes right here -- 10% growth for china. 0. on the negative side. for spain, on the global financial system, imf says it remains fragile. capital remains a concern.
9:43 am
it's saying the rise in asset rises in those markets cannot be excessive. congress is saying it's getting close is what the imf is saying. as for fiscal policy, which has been a concern, they say right now they need to remain supportive but there's a danger in coming years all of the debt issuance could crowd out the private sector. >> thank you very much, steve liesman. yesterday we asked you if bernanke was good for your money. and the response pretty much at split. today our "industrial poll" asks, is tim geithner good for your money? go to "squawk on the street" now, this is important. it's not our e-mail address. >> it's not? >> no. your vote doesn't count if you e-mail it. you got to go to sws x"squawk o
9:44 am
street" >> are we a bunch of bureaucrats, we're going to have 14 addresses? >> you're asking me? i don't know. also, term limits for fed chiefs, what do you think? >> i don't know. >> "the wall street journal's" joz hillsenraf will raise in. crime in new york city has dropped 27% since 2001. response times in madrid... ...have been cut by 25%. cities all over the world are getting smarter... ...and safer. every time an emergency happens... is generated. smarter cities fight crime... fires... flu outbreaks... capturing the data. detecting the patterns. sharing it across departments. ...responding to emergencies... ...even preventing them. making cities safer. that's what i'm working on. i'm an ibmer.
9:45 am
let's build a smarter planet.
9:46 am
yeah. would you like a pony ? yeah ! ( cluck, cluck, cluck ) oh, wowww ! that's fun ! you didn't say i could have a real one. well, you didn't ask. even kids know when it's wrong to hold out on somebody. why don't banks ? we're ally, a new bank that alerts you when your money could be working harder and earning more. it's just the right thing to do.
9:47 am
time for this morning's commodity currenter. it is the industrial metals edition, mark, back by popular demand. copper is lower, so is nickel and zinc. aluminum unchanged. let's get through the most precious metal of all, david faber. >> ah, thanks, erin. strange story this morning involving actually a company i talked about yesterday and broken a story about. live nation. it was yesterday about 11:30 or so we told you live nation and ticketmaster would get approvea from the doj to compete their merger of equals and in fact they did get approval and complete the deal. we wake up today to one company.
9:48 am
there it is, live nation. and to this news, liberty media is making a tender offer to acquire another about 14 -- actually, make it 20-some-odd percent of live nation that it doesn't already own. it owns about 14.6% of live nation. that's because liberty media owned a stake in ticketmaster, which with the deal closed, is now a stake in live nation. there you see it. it's a $12 a share tender for 34.5 million shares and it just hit this morning. why? well, that's a good question. and it's one we wanted to put to liberty media. it's early there. and, you know, they kind of like to -- it's denver. they like to relax out there. so we didn't get a call back as of yet from liberty. as i said, they already own 14. % of live nation's outstanding shares but this tender, the day after the deal is completed is
9:49 am
interesting and somewhat unexpected as far as i've been aware, at least at this point. also trying to get some other answers, but this is what we know. this is what is out there. and you see the stock trading up. now, yesterday live nation and ticketmaster shares were also up sizably after our report that the deal would receive doj approval and, of course, after that approval came in. the stock's up 15% to 16%, adding another 12% to that. bought live nation shares on monday, doing pretty well right now. and, again, of course when it comes to liberty, it's got to be complicated. now the 14.6% stake in live nation is held at liberty interactive but it's liberty capital that's going to be doing the tender offer. so we're imagining here that liberty capital is going to be giving cash to liberty interactive for its stake. and then embark on this tender offer at $12 a share to buy even
9:50 am
more live nation, which will be housed at liberty capital. did everybody get that? i hope so. it's never easy with liberty. of course, they've been in the news two days in a row. who would have thunk it? but a good day yet again for live nation. unexpected tender for 34.5 million shares at $12 a share from liberty media. mark, back to you. >> thank you, david faber. this morning senator jim bunning weighing in on bernanke and geithner. guess what? he doesn't like them. >> he'll get fired. he'll get fired by the president of the united states because of his inability to handle the job as treasurer -- or the secretary of the treasury. and, you know, set fiscal policy, this is what the treasury secretary is supposed to be involved in. my question is, is he capable of handling the fed job for four more years? i don't think so, and i have a
9:51 am
lot of reasons why. >> all right. "the wall street journal" writing about term limits for fed chiefs this morning. bunning, of course, as we all know has not liked anyone who's run the fed in quite a while. where do you think he would stand on term limits? >> i think he would probably be for it. i think he would still want to get rid of bernanke but he would probably be for it. anything to rein in the power of fed chairman. i will give you why i think it makes some sense to do. first of all, it actually gets to one of the problems that caused this crisis. a lot of people would argue that the fed was complacent in the later -- the later stages of alan greenspan's reign, 19-year reign as fed chairman. if you have term limits, it takes away the complacency. the place is changing every few years. the ecb does it and it's working for them. they have eight-year terms for ecb presidents and then they're out.
9:52 am
and then the final reason is that i think this would appeal to people on the hill like bunning and many others who sense the demand among the public to -- to change the fed. there's a populous backlash and term limits have been popular in the past. so i think it makes -- it's something that ought to be on the table. >> and how long would be -- would you put the term limit in for? >> so -- you know, so the ecb is a benchmark for this. they have eight-year terms for ecb presidents. so trishea is out after eight years. a fed chairman's term is four years. you put two term limits on it and that gets you to eight. i think after eight years, ben bernanke will be pretty exhausted and ready to go anyway if he gets through the second round. >> what's interesting, one thing that seems to stand out is the way the europeans runs their central bank and the way we run
9:53 am
our, trishea talks. after he makes a decision and gives announcement to the press. and our fed, frankly, appears to do exactly the opposite. he did one interview and that was 60 minutes in the middle of a crisis. >> you know, bernanke's been talking a lot more than the fed used to. he's given a lot more speeches. he takes q&a at his speeches these days. and there was actually some talk at the fed about starting to do press conferences. it didn't get anywhere. who knows? that's something that could be back on the table at some point in the future. >> jon, thank you very much. >> okay. as you all vote -- i get they're voting for tim geithner today but anyone who wants to comment on the idea of term limits, let us know what you think. we will talk about home builders after this. >> don't forget to vote. is geithner good for your money? please note, this is not our e-mail address. this is it's a place on our website
9:54 am
where you vote. e-mailing, you won't count. @@@@@@@@@@@@@@@@
9:55 am
9:56 am
case-shiller data out this
9:57 am
morning showing mixed messages for the housing market. and we're waiting on the fhfa data, which crosses at 10:00. we want to focus on home-building stocks, and that's because you have been clicking on them on our website. david goldberg joins us now. building and building products analyst with ubs. what's your take, david, not in light of just of the case-shiller numbers or data today but the existing home numbers that says without a new home buyer tax credit, the market really looked pretty terrible? >> erin, i think you have got to remember, it's not just the new home buyer tax credit it's the urgency around the new home buyer tax credit. remember, it was extended. you have to have your home sold before the end of april, close before the end of june with a new credit but it was urgency the people lost. people pulled for it in november and it didn't get as good in december. >> is this an indication of where it's going? it's going to go away for good some time soon. >> i think what you're going to see is a pattern of uneven
9:58 am
results. some metrics are going to look good. some aren't going to look good like the existing home numbers we saw yesterday. i think you will see a pattern through the first half of this year where you get really rocky reports, very uneven reports about traffic and sales and what's happening in the home building industry. i think that's going to eventually in the second half of the year start to level off, start to get more stable. you see home prices stabilize. especially when you start to the broader economy, you get a little better. >> yet out of ten homebuilders, you only recommend one as a buy? >> that's a valuation call. what's going on with fundamentals and how much you're willing to pay for it. we think the stock will drop by another 110, 115%. we will be getting more constructive on the group as wholer prices. >> these are raelian, kb, lennar, will eventually rise to a buy? >> some of those possibly, sure. i couldn't tell you which ones but some of them. >> those are the ones that david as rated as neutral right now. >> exactly. >> david, thank you very much.
9:59 am
>> my pleasure. we'll be right back. the algae are very beautiful. they come in blue or red, golden, green. algae could be converted into biofuels... that we could someday run our cars on. in using algae to form biofuels, we're not competing with the food supply. and they absorb co2, so they help solve the greenhouse problem, as well. we're making a big commitment to finding out... just how much algae can help to meet... the fuel demands of the world. ♪
10:00 am
[ male announcer ] introducing the all-new lexus gx. ♪ it has the agility to avoid the unexpected... ♪ ...the power to take on any mission, and the space to accommodate precious cargo, because every great action hero needs a vehicle. ♪
10:01 am
welcome back to "squawk." rick santelli here. in a few seconds we have data
10:02 am
and fresh data for january. home price index will be november. here we go. richmond fed index for january is down two. that is a little worse than expectations, not as bad as minus 4 from last look. if you look at consumer confidence, 55.9. that is definitely improved from a slightly upwardly revised 53.6, which pretty much was where expectations were. so that's a pretty decent number. home price index, don't see it yet. we're expecting that shortly. in terms of the two major january numbers out, it seems as though we're seeing a small uptick in rates and a bit of an uptick reducing losses in equities. remember, if you're looking at confidence, we all know that it seems to correlate with equities and equities have had a little stiffer run of late. maybe the next survey will be even more enlightening. how let's go back to erin. >> thank you very much, rick santelli. the reaction, bob pisani. first of all, bob, consumer
10:03 am
confidence, a ray of light. >> that's the bottom line with expectation. still getting a little choppy on the economic data. i think the big thing that's moving things today is china's finally gone through or what they were talking about last week or implying, and tightening lending standards and basically holding back at this point. i have been trying to emphasize all morning how important this is. this is not some kind of intellectual thing way out there. >> they buy 40% of the world's copper and biggest user of every industrial you could think of. >> today, 70% of dupont sales overseas, johnson & johnson, 50% overseas. when you have abig producer of china making announcements that they're pulling back, you have to pay attention to it. >> hits home at the bottom line. >> we have to remember steel. remember ak steel -- >> and how china was driving up the prices. >> and helping things. today if you look at u.s. steel, u.s. steel is levered to the u.s. automotive industry. flat-rolled steel.
10:04 am
they came on and said prices were improving. they went along with ak steel. the problem is the demand is still not improving in a big way. >> and they're more levered than some of the competitors. >> and flat-rolled steel, that's what used in cars essentially, and that's a little bit of a problem. it depends on what kind of industries you are in. it's not just the steel industry is virtually all the same. how international you are, what kind of businesses you're in. and today if you look at some of the big international commodity stocks, not only are they being heard on china but the dollar has been stronger today in response to what happened and big commodity names are weak as well. >> when you raise that point on the steel industry, it's on a day they say, look, ford is bringing one plant up for ford explorers and you hear a sign of improvement in the auto industry. it's a little bit of a wet blanket but it's still small. >> not enough to make a difference in a truck company like u.s. steel. that's what you want to look at. and still a mixed bag on the fm
10:05 am
situations. regents financial, all of these banks in the southeast have a simple problem, they have huge real estate loans throughout all of the states in the southeast and still having big losses. regions financial is based in alabama. they're a very good example of what's going on in that area. >> bob pisani, thank you very much, getting to the bottom of it. as bob was talking about the commodities, crude oil trading down. not nearly a dollar. sharon, how come? >> because of what you and bob were talking about. because of china, because of the dollar strength, we are looking at oil prices not just here at the new york mercantile exchange but also london. in fact at the nymex, we hit a one-month low today. it's interesting what happened to gold and oil so far in 2010. a lot of folks thinking those would be the best performers for 2009. in fact oil prices doubling. a lot of investors got a great return on their money. what about this year? according to barclays latest survey done in mid-december asking where investors want to put their money. they want to put it in grains.
10:06 am
gold and crude oil don't make the top five. they're anticipating grains will see a more than 25% iran on their money this year. diesel, copper, natural gas and platinum rounding out the top five, best performers according to investor surveys by barclays. keep in mind wheat and corn are are down 8% to 11%. platinum the only one up so far this year about 4%. have to mention, sugar today hit another 29-year high. mark and erin, back to you. let's check in with bertha at the nasdaq. bertha, apple. >>. but i guess people are nervous what happens after the close? >> and i think it's also the fact tech these days is not getting much respect. convergence came out with a note that said if you look at the top 20 with the etf on tech, a lot of them have great valuation right now. we've seen great earnings from tech giants but they don't get the respect. texas instruments had pretty good earnings. chips are selling off.
10:07 am
apple, it's higher today. but given the blowout quarter, you would have thought it would have done much better. the street is giving them a lot of praise. they're raising the price target number to $2.75. over at credit suisse, up half a percent. a couple of other thats up, eight of ten are actually down this morning as overall market concerns continue to weigh on tech here. citrix is up and amazon is up as well, in terms of the tablet beating the kindle. we will see what happens tomorrow. applied materials is hoping to boost the rest of the equipment stock. citi helping that outperform. mark, back to you. >> thank you. just minutes ago, imf upgrading its growth global forecast for 2010. the international monetary fund sees global growth up 3.9%. u.s. growth projections also upgraded to 2.7% for 2010.
10:08 am
the imf sees 10% growth for china this year but adds to global financial system remains what it calls fragile. president obama seeking a three-yaer freeze on domestic spending in his 2011 budget. administration officials say the proposal would save $250 billion by 2020. the president will outline spending plans in his state of the union address wednesday. he will then unveil his budget on monday. later in the show, we'll talk about the impact on the market and some of the mixed messages coming out of washington. so don't go away. u.s. retail sales should rise 2.5% this year. that's according to the national retail federation. they say chain stores have made it through the worst of the downturn. the 2010 forecast marks an unexpected improvement from a 2 1/2% drop in 2009. here's how some of the nation's
10:09 am
biggest retailers are fairing right now. i'm not sure why we saw gold and oil. anyway, american international group deciding not to sell its aircraft leasing unit. according to the ft, aig said it will not repeat a big profit from the investment of international lease finance corp. aig got about $180 billion from the government and still has been struggling to find buyers due to the aircraft's leasing companies' high debt load. all right. we have breaking news from diana olick, i assume on home prices? >> that's right. home prices rose 0.7% from october to november on a seasonally adjusted basis and are up .5% from one year ago, that according to a new report from the federal housing finance agency. prices are 10.3% below the april 2007 peak. october's number was slightly revised down. remember, this report draws from
10:10 am
price data from homes with conforming, that is fannie and freddie loans so they have to be below $429,000 in most markets or $417, 000, hike e higher tha cities. and that's why it's different from realtors yesterday that looks at sales of all existing homes. this report is for november when the home buyer tax credit was going gang busters. the real estate bust was for december when some thought the credit expired. david? >> thanks, diana. stay right there. let's also bring in mark sandy, chief economist and co-founder of and get his reaction to today's data. looks like we're getting mixed signals. we heard case-shiller this morning. you heard diana. what are your thoughts on housing? >> i think it confirmed second half of '09 and diana put her finger on the tax credit, fed purchase credit kept rates down.
10:11 am
but the most important thing were the loan modification efforts that delayed foreclosure sales. i think as we make our way into this year, although support is less supportive, we will see more price declines. >> mitigation has not worked out that well and a lot of people believe ultimately the foreclosure pipeline and that shadow inventory is still out there in a significant way, mark. >> yeah. i mean if you total up all of the loans in the foreclosure process, they're clearly headed in that direction, 90 days and over delinquent, it's somewhere between 4 million and 4.5 million loans. some will head through foreclosure to a sale. a lot of that will be spring, summer and that's when we will see prices start dipping again. >> that doesn't paint a particularly positive view i would think for things like consumer spending, people struggling at least to hopefully have some obviously, people have a lot of equity in their homes. nonetheless, tell me or translate for me what that will mean in terms of consumer spendsing in the overall economy.
10:12 am
>> good point. i think that highlights that the economy is still fragile, that it's going to be difficult for the recovery -- and we're now in a recovery -- to evolve into a self-sustaining economic expansion because of the price declines. nothing works well in our economy when prices are falling. it undermines well a difficult financial system. as a result, i think policymakers need to remain aggressive, particularly in the housing market. >> diana, if mark's right, 2010, another down here for housing. that will be quite a few in a e row there, isn't it? >> it will be. we heard from blitzer this morning and he cited foreclosure as t the main reason. he said it will not be it will go down and come straight back up. it will bump up and down through 2010. and most people expect to see price declines in 2010. the question will be about jobs in the summer. once you see that government stimulus leave the market in the form of the lower mortgage interest rates and in the form of the exiting of the first-time home buyer tax credit, what will it mean in the summer?
10:13 am
it will mean jobs. if people have jobs, they will think about selling and buying a new home. if they don't, you will see again more foreclosures and more pressure on prices. >> mark, have you changed your opinion at all on housing as the data's rolled in or have you more or less been consistent in expecting that in the second half of this year we will see price declines? >> no change. i've expected this quite for some time. i was surprised by the price of strength this summer and fall. didn't anticipate that the policy support would be as supportive as it was. but i think it's only delaying the price declines we will get in spring of summer. no, i've not changed my view. >> we will leave it there. mark zandi, thanks to you. and diana olick. erin, back to you. and jobs being created by an industry you may never expect. we have details on that. and dupont beats the street and boosts its outlook. the stock up 41% over the past year. is it time to load up on this chemicalmaker? as we head to break, some of the biggest percentage gainers
10:14 am
on the s&p and nasdaq so far. market's up after a rough start. ] it guides. it shows. it slides. it tows. it sees. it calls. and it fits. we gave it more ideas per square inch... because more is what we do. introducing the terrain, the all-new smaller suv from gmc.
10:15 am
10:16 am
all right. we're about 45 minutes into trading and stocks have definitely had a lift here after a -- as you can see -- negative open. i think we opened down about 25 points or so. now we're up 36. travelers, the best-performing stock on the dow, up more than 3% on a better-than-expected profit report.
10:17 am
amylin soaring 10%. citi boosting its target from 27 to 14. and two new 52-week highs. amer asourcebergen and sherwin williams painting the town red. >> breaking budget news. hampton? >> erin, the latest news on the federal deficit are out from the congressional budget office. the cbo now predicting that if current laws remain unchanged, the federal budget deficit will be $1.3 trillion for the current fiscal year, 2010, or 9% of gdp. that is down slightly from the 9.9% and $1.4 trillion estimate put out back in august. cbo also saying if legislation enacted that boosts spending or reduces revenues, the 2010 deficit could equal or exceed last year's shortfall, which, of course, was a record. further down the road, the cbo
10:18 am
saying under current federal law the outlook is daunting for the next several years. projected deficits will average about $600 billion per year from 2011 to 2020. a couple of things as to why the figure is slightly lower than last august. basically, according to cbo, it looks like thanks to lower spending by the treasury department, the bank bailout and stronger-than-expected economic growth short term, we've got a slightly lower deficit projection from the congressional budget office. erin? >> thanks very much, hamp. today on "street signs," cbo director doug elmendorf will be with us. he is one of the most important people we need to hear from. and we will be joined by orrin hatch, who in an op-ed with chuck schumer put forth an idea where they think they could encourage hiring by getting rid of the payroll tax selectively. >> all right. sounds like it might work. have to look at it. want to bring your attention to some stocks on the move.
10:19 am
and that, of course, means the one, the only, matt nesto! >> thanks, mark. appreciate it very much. you guys see u.s. steel? stock's getting hammered. down about 8% down. now down 20% since earning season kicked off their fourth quarter loss if you will. $1.86 versus $1.44. revenues down 25%, although they did beat expectations. their forecast looks to be a little bit soft as well. regions financial posted a wider-than-expected loss. they're chargeoffs did go down a little bit. that one down about 2 1/2% so far here today. the baker hughes is strong here today. up about 3% after their fourth quarter earnings topped estimates by not a little but by a wide marriagimargin. 23 cents versus 35 estimate. their north american down 36%. but, again, that was already baked into the stock. so it's a beat. speaking of beat, vm, second
10:20 am
best stock in the russell, big first quarter full year trifecta, better-than-consensus, that stock is up more than 10%. and hershey's holding strong in the face of goldman sachs putting it on the conviction sell list. they think the probability of a take-out has gone down. they think that stock is headed to $32 a share. it says $36 feels fine to me right now. let's get to david faber for the latest on the hill. >> thanks, matt nesto. interesting battle shaping up between the independent directors of alcon and novartis. many of our viewers may know a couple of weeks ago novartis, right at the beginning of the year actually, novartis did what was anticipated in some ways, making a deal to exercise an option to buy a stake of alcon
10:21 am
that was held by nestle that was at $180 per alcon share. but perhaps surprisingly at the time on two levels also decided to make an offer for the minority shareholders, namely the shares that were outstanding and publicly traded of alcon, a swiss company, though much of its operations and the like in texas. a level that was well below the bid that nestle got for its shares. on day one, novartis was aggressive making it clear its belief it would soon own as much as -- more than two-thirds of the company with the purchase of the nestle/alcon stake would be able to replace the board of directors and basically push through this offer that it made of 2.8 shares of each alcon share. in the weeks since, things have gotten a little more interesting. the independent committee hired the likes of the firm of greenhill and company and sullivan and cromwell and really got moving in terms of defending
10:22 am
what it says are its rights to make sure that novartis does not get anywhere in that attempt. let's bring you up to date on that as well with new news, which is one of the larger shareholders of alcon, alliance bernstein, sending a letter to novartis directors and demanding in the strongest possible terms that it back off in terms of its claims that it can sort of just try to steamroll the independent directors. alliance bernstein saying, we were extremely surprised when knnovartis stated january 4 tha in the event that the board does not approve the proposed merger, know var it would push through the shares. vasella will remain chairman, by the way. he did announce he will be
10:23 am
stepping down very shortly as ceo. he also was with us this morning on cnbc europe. this is what he had to say when asked about that lesser offer to alcon's minority shareholders. >> first of all, for the nestle stake, we paid $168, not $180. and secondly, we very carefully evaluated what the unaffected share price of alcon is and valued it at $137. so i think the 2.8 shares of novartis for each alcon share is very share. having said that, i'm not surprised that minority shareholders would like more. that is pretty usual pattern in such transactions. >> in fact it is. up 247 transactions that were looked at by people close to the situation, the minority, never received less than the majority.
10:24 am
at the end of the day, when you speak to those associated with alcon, they tell you that all roads ult muimately will lead t this independent committee and this, of course, erin sets up what will be a battle up ultimately what many shareholders in alcon currently think is they will get the price that they are hoping for. we shall see. we will be paying close attention to this significant deal and significant battle. back to you. >> thank you very much to david faber. just ahead -- new jobs being created in an industry that's been bruised and battered. "squawk on the street's" "daily jobs reports" is next. and we want to hear from you about your thoughts on tim geithner. i must say, if it's any indication of america, what they care about, so many of you have been e-mailing us and voting about tim geithner. many more people did about ben bernanke. tim geithner is more of a lightning rod, no matter which way you sway. vote, please,
10:25 am
30 minutes left before the polls close. st: could switching to geo 15% or more on car insurance?e you host: did the waltons take way too long to say goodnight? mom: g'night john boy. g'night mary ellen. mary ellen: g'night mama. g'night erin. elizabeth: g'night john boy. jim bob: g'night grandpa. elizabeth: g'night ben. jim bob:'night. elizabeth: g'night jim bob. jim bob: g'night everybody, grandpa: g'night everybody. jim bob: g'night daddy. vo: geico. 15 minutes could save you 15% or more.
10:26 am
national car rental? that's my choice. because with national, i roll past the counter... and choose any car in the aisle. choosing your own car? now, that's a good call. go national. go like a pro.
10:27 am
ford to stand on the automotive sector.
10:28 am
the stock is up more than 500% in the past year. wow, we're still only at $11.25 a share. start low, still low and that's a big gain. today the company is saying it will be creating jobs in the automotive industry. phil lebeau broke that story yesterday. he's got "the daily jobs report" to talk about how it breaks down and where and what we should read into it, if anything. phil? >> the board report is 1200 jobs being added on the south side of chicago, where they will build the next generation of the explorer. but look at the all of the job announcements we have seen over the last couple of months. it's significant. volkswagen adding $2,000 for a new plant in chattanooga. kia, new plant in georgia adding another $1,200. and new jobs from chrysler adding 400 designers and engineers. toyota, second shift for its tundra plant in san antonio, texas. and gm adding 200 jobs at an electric battery plant in detroit and more jobs in the washington area. that announcement coming later
10:29 am
today. they are adding these jobs in part for green technology, gearing up the industry for battery technology, electric vehicles. they will be added gradually. many of the green auto jobs have been created in part with department of energy loans as these plants have been retooled or new plants have been opened up. ford and other automakers are also adding shifts to underoutalized plant like the attorney plant on t torrent plant in chicago. as these plants continue to ramp up while others who were phased out or announced to phase out last year as they start to close. either way when talk to auto workers who have been hit hard over the last two years, they're welcoming this news. >> happy for light a lot of peo laid off about a year ago and maybe some new hires too, then. >> long overdue? >> way overdo. things are looking good. >> it's good. it's a good sign for the whole company. >> i feel great.
10:30 am
it's very good to know that a lot more people are going to come back to work, and it gives me a better sense of job security. >> for more on understanding what this means for the auto industry, check out the blog behi behi behindthewheel.cnbc pts come. we talked about 5,000 to 6,000 jobs added, last year the industry cut about 450,000 jobs. this is just a drop in the bucket. >> there's the context but you have to start somewhere. phil lebeau, thank you very much. up next -- clues to the strength of the economic recovery hidden inside the dds. dupont's numbers. we will talk about why they were way better than expected but the stock reaction is a little bit blah. check on the dollar as we head to the break as bob pisani's been highlighting. up half a percent. i hear you're the clown in charge. so, cirque du soleil becomes...
10:31 am
...cirque du sun life. because soleil means sun.... (gibberish) i'll take that as a yes. (announcer) sooner or later, you'll know our name. sun life financial.
10:32 am
10:33 am
let's take a look at the markets and the internals. dow up 20 points, not bad. the futures said we would be down. nasdaq just hanging on. also s&p. internally, oh, dear. oh, well. quite a few more down than up on the big board. same on the nasdaq. so actually it's kind of a negative day, erin. >> thanks, mark. >> sorry. >> there he is. oh, look the market's up oh, but it really stinks.
10:34 am
>> i thought it was -- the internals tell you the true story. >> chemicalmaker dupont is part of the problem, mark. i know it's only down a penny. here's what happened. they came out with their fourth quarter results. they were better than expected. they boosted their forecast and yet nobody seems to care. first off, the company's conference call, bb capital markets and a man that everybody listens to on chemicals, frank, dupont, just looking at the surface it looks better than expected and a boost. is it unfair that the stock is down? what do you think? >> actually, i was thinking it would be pretty much in line. if you look at the top line number, 48 cents. there was four penalty points over a restructuring charge. that gets you to over 44, where bb & t's number was. but it gets you right in line where the consensus was. i think when people read the release and said, gee, they're upping their guidance, this is very positive. but the reasons why they upped
10:35 am
their guidance, as they reca recalculated their pension headwind in 2010, because of the plan is a bit better in 2009, thank you very much, fund managers, for helping us out there, that actually added 10 cents to their fast, but take away a nickel because there's venezuelan currency that will hit them in the first quarter. so it's really right in line with where they were before. >> so it's currency and it's pension, and, well, it's not actually bread and better chemical business. >> the upside. >> the businesses. what do you see in terms of business and what they see about the economy, keeping in mind as we said about three-quarters of this company's business is outside of the u.s. >> certainly, the fourth quarter is it is predominantly outside of the u.s. when you go into the first half of the year where they have a big ag part, about 45% is outside of the u.s. they are talking about volumes overall, up 10%. remember how bad the fourth quarter was last year. we had a pretty easy hurdle to creep over. but as they look out into the
10:36 am
coming year, they expect volumes up mainly in asia, a little bit in the u.s. europe is not so much. globally gdp, they're expecting about 3% boost. >> okay. i've listened to you. i don't know whether i should buy the stock. >> listen, i like -- i like the direction that the company's heading in. you have to recall that their kozar highs, pharmaceutical royalties, come off patent april 1. that's a huge hit of their earnings. 20% of their earnings will eviscerate. >> what is that, high blood pressure or cholesterol? >> blood pressure. >> okay. >> i would say, love the div de dividends. i think the valuation is on the high side. >> so buy it? >> we are investors investors to hold it, mark. >> okay. >> if you own it, mark, you don't want to dump out but do not buy it. >> okay. i just want -- all right. thank you, frank. where's the money flowing?
10:37 am
"stocks on the move" coming up next. and tomorrow, attention turns from ben bernanke to timothy geithner. lawmakers will be taking, we're sure, tough questioning to the treasure secretary about aig. that will be a very juicy hearing. by the way, henry paulson has said he will be testifying at well. and what this means is it will be great political theater. >> we missed hank. and be sure to vote in our poll, is timothy geithner good for your money? go to "squawk on the street".cnbc pts come and vote. t an entire portfolio of stocks. market experts show you how through fidelity's extensive trading knowledge center. and fidelity gives you free research from 15 independent firms, with accuracy scores... to help you decide which analysts to trust. find out why more and more active traders are turning to fidelity for a smarter way to trade online. trade like a pro. trade with fidelity.
10:38 am
10:39 am
[ crowd gasps ] [ announcer ] if you think about it, this is a lot like most job search sites. - they let everyone in, - [ crowd groans ] so the best people can't stand out. join the premium job site for only $100k+ jobs... and only $100k+ talent. at's on the minds of independent investors? let's ask. when you're trading a stock, every penny counts. i hate when the trade is done and you find out you paid more than the quote price. i want it at the price i expect... or better. td ameritrade's unique trading platform uses multiple market centers to help you find the best possible price. i like those odds. i know they can't flat out promise a better price, but they're always looking for it.
10:40 am
they know what matters to me. every online stock trade is always $9.99. not a penny more. and no maintenance fees. who else does that? are you ready to declare your independence? td ameritrade. independence is the spirit that drives america's most successful investors. announcer: trade commission free for 30 days, plus get 100 dollars cash, when you open an account. welcome back to "squawk on the street." i'm matt nesto. did you see barnes & nobles this morning? wow wee, stocks up more than 10%. and this on reports of trader speculating that maybe -- just maybe their e-platform might be included in the new apple tablet. what could be better than that? not much or the fact that your
10:41 am
rival, which is shrinking and that's borders group, the ceo there resigning after one year on the job. further chaos for poor, little borders. barnes & noble loving it. abc, as easy as one, two, three-year high. hey, hey, amerisourcebergen, good earnings. full year looks good and the market is focusing on that and ignoring the first quarter, which also looks pretty good but they're pushing that one higher. sherwin williams very strong, with the trailing results and strong increase for your full year forecast as well. let's get to david faber for the latest from him. >> thanks, matt. earlier we told you liberty media commencing a partial tender offer for 34.5 million shares of live nation. the company already owns 14.6% of live nation shares after they got yesterday after closing with
10:42 am
ticketmaster of equals. on the phone we have greg maffei, ceo of liberty media to ask him. first question, why the tender off for live nation shares? >> good morning, david. thanks for having me. we're excited about the prospects for the merged live nation/ticketmaster and we had the opportunity to increase our stake and exposure and we went for it. >> what are you excited about when you say you're excited about the opportunity? >> i think there are a couple of things. the ticket is the golden piece of the pie today in the music business. the opportunity to bring more value to consumers by bundling other pieces, having dynamic pricing. we think those are great opportunities for the merged company. >> are you capped at 35%? >> well, the company we both have an agreement to hold at 35% and the company has a pill at that level. above that we had to do something that the kofs response ul with the company's board of
10:43 am
directors. >> what confidence do you have you will get this done with the stock at $11.79. >> we will take all of the shares the market will give us. >> within liberty, lindta had the ticketmaster stock and live nation stock. and cap is making this offer. how is this going to work? is alkappa going to transfer cash to linta for the shares? >> the reality is lcapa has more lick qu liquidity and our live nation shares fits better than that and by time, i think it's time the linta is better moved. >> why does it bet better than lcapa? >> lcapa has a sizable business in sirius/xm and live nation. >> is there synergy between
10:44 am
sirius and live nation? >> that's the golden dream down the road but at the moment we're excited about the two business agreements on their own. >> when does the tender expire? >> we haven't yet launched. we expect to launch in the next few days and then it will be subject to the usual 14-day rules about -- i think it's 20 business days. >> and, again, just to come back to this for liberty watchers to make sure to clarify, at some point lnta will move its stake, the 14.6%, to lcapa, correct? >> we have not announced that will happen but that seems like a logical path for the future. >> obviously, you're very inspired by the potential for this combination, aren't you? >> i think the companies have great prospects. the remedies put forth are pro-consumers but nonetheless, we're excited about the business opportunity for the merged ticketmaster/live nation. >> greg, we appreciate you coming on with such short notice. >> thank you. thank you very much, david faber. is tim geithner good for your
10:45 am
money? logon to, and there's been some confusion, so i will make it as clear as i can. that's the address right there. no www. just and that is where your vote is registered. e-mailing us, we love to hear from you, but it won't count in the poll if you send it to us by e-mail. results in about ten minutes. yesterday's poll on bernanke, by the way, a debt heat, 1,600 responses, debt heat. i understand we have more than that today. >> yes, we do. straight ahead -- the budget freeze and leftover stimulus money. remember we were told we would have $400 billion of the $787 billion to be spent this year or after. but $400 billion, mark. you can do some damage with those expensive ties you like to buy. we will talk about whether this is a mixed message coming from the white house about freezing money but at the same time spending $400 billion. plus, geithner in the hot seat.
10:46 am
what does it mean for your money? we'll connect the dots. and the market milestone -- >> which brick is celebrating a bir birthd birthday? >> wow. >> it's like they're little children and could become the third largest economy in two years. incidentally, bric, if you move the letters around, they could have been called the cribs. >> that's right. anyway, first -- >> i'm thinking of all of the other things it could be. there aren't any. melissa, what's coming up? >> fascinating. coming up at the top of the hour, lots of news out of washington, including president obama's plan to freeze parts of the budget. this as fresh budget data is released. we will debate whether the president can reduce the blooming deficit and we will preview the aig hearings on capitol hill where tim geithner will be on the hot seat. and our call of the wild, whether he can survive his role in the controversial aig bailout. all of that plus a preview of apple's tablet that's due out
10:47 am
tomorrow and a recap of earnings. first, "squawk on the street" is back after this break. but you can still see him! you just said he was in... copenhagen. come on! that's pretty far. doc, look who's in town. ellen! copenhagen? cool, right? vacation. but still seeing patients. oh. [ whispering ] workaholic. i heard that. she said it. i... [ female announcer ] the new office. see it. live it. share it. on the human network. cisco. not long ago, this man had limited mobility.
10:48 am
last month, this woman wasn't even able to get around inside of her own home. they chose mobility. and they chose the scooter store! if you or a loved one live with limited mobility call the scooter store!
10:49 am
no other company will work harder to make you mobile or do more to guarantee your complete satisfaction. if we pre-qualify you for a new power chair or scooter and your claim isn't approved, the scooter store will give you your power chair or scooter free. that's our guarantee. they were so helpful and nice. they filed all the paperwork, and medicare and my insurance covered the cost. we can work directly with medicare or with your insurance company. we can even help with financing. if there's a way, we'll find it! so don't wait any longer, call the scooter store today.
10:50 am
market milestone time. india's constitution turns 60 this year. the country became independent on august 15th, 1947, but it was not until january 26th, 1950, 60 years ago today, that india had a written constitution. over the past year, bombay sensex up 93%. a recent report by price water house says india has the potential to become the world's third largest economy by purchasing power by 2012, overtaking japan. >> well, there are reports president obama intends to propose a three-year freeze in discretionary spending. that accounts for one-sixths of the federal budget. our all-stars talking washington, wall street and your money. rick santelli, john harwood and, of course, erin and mark back at
10:51 am
the nyse. mark, let's start with you. it's funny, everything except this, this, this, and this. >> exactly. we heard this from presidents before. i remember covering the first president bush and i believe he proposed what he called then a flexible freeze in spending. the administration said they briefed reporters last night, said they're going to propose a hard freeze on the aggregate level of nonsecurity-related discretionary spending. so that's national parks, that's nasa, that's all of the things that aren't about -- directly related to national security like the homeland security department. it will save $250 billion over ten years but it's one of these things that in the initial phase isn't going to save all that much, just $10 or $15 -- $10 billion or $15 billion in the next budget year. so it's a fraction of what we need from our deficit but i think the administration is counting on the word freeze wor cutting through the clutter and getting americans to think maybe they're not as big budget
10:52 am
busters as we've been thinking. >> why do you think this is coming out now? what's your impression? why today? >> why today? the state of the union address is coming up on wednesday and the administration is putting it out. >> the state of the union is going to address a hot-button issue and it's going to make its way in. is your personal thought that this is something serious or that this is just political fodder for a sound bite for tomorrow night? >> i think this is mostly a symbolic cut. it will produce some savings, but not a lot. the real savings the administration is going to be talking about in the state of the union is this definite reduction commission that democrats and republicans have been talking about in washington. the real money, as you know, rick is in entitlement spending, social security, medicare and other mandatory programs and those have proven very, very difficult to cut. the administration has proposed cuts in medicare reform and they
10:53 am
need to go further to reassure the markets and to reassure anxious voters in this country. >> you're my man in washington. are they not, on the other hand, also talking about another new and improved 80 billion job stimulus package? yes. yes they are. and the administration is going to try to make a short-term/long-term argument. short term, we have to do something to get people back to work while also taking care over the long run, and i would expect that in their jobs proposal that comes out in the budget, they're going propose that it be paid for, financed over ten years, but not in the immediate term. it will exacerbate the deficit in the short term. >> i know we have $400 billion left of the 487, and i know a lot of that has been spoken for. we need another 08 billion plus in an additional jobs package. it does sound a bit ridiculous, doesn't it? anybody? >> i think so.
10:54 am
>> why ridiculous? >> well, we have $400 billion we haven't spent, why couldn't we reallocate it that, we didn't allocate it correctly the first time toward jobs why not do that instead of having the immediate reaction be let's go get 1 billion more. >> it's a misstatement that they reallocated the first stimulus. i think the first stimulus is not enough to address the fiscal problems we've got. mark zaerngsd the independent economist who advised john mccain said from the beginning that the stimulus wasn't enough and he says we need a couple hundred billion more. >> he advised john mccain. how did that turn out? we've got to leave it there. john harwood and rick santelli. we want to go to jim goldman who has breaking news. >> good morning to you, indeed. there is news from ebay. the company is once again changing the way it deals with fees as far as sellers is concerned essentially eliminating the fee struckure and the up-front listing fees
10:55 am
for the occasional seller, that's 28 million people who regularly use the ebay site. in case investors are concerned this might be a hit on revenue, keep in mind the listing fees only represent 20% of the overall marketplace revenue. that was a number closer to 40% just about two or three years ago. in fact, over the past three years the listing fees have steadily been decreasing, eliminating the fees altogether. one analyst told me it was like a pr carrot being extended to the vociferous folks out there who have been anti-ebay as far as the way the company has been treating sellers. indeed, this will be an interesting strategy and we'll see how it plays out in the marketplace. mark and erin, back to you. >> okay. just ahead. six in 60. is it time? >> almost. >> there's still time to vote, but not much. literally two minutes until we reveal the results on the street. no www in front of it.
10:56 am
i don't know why, but no www. i keep track of my entire business on this spreadsheet... and all of these. paid invoices go right here. bang! - that hasn't been paid yet. - what? - huh-uh. - all my business information is just a phone call away-- to my wife... who's not answering. announcer: there's a better way to run your business. intuit quickbooks online organizes your business in one place. it easily creates invoices and helps you stay on top of your business anytime, anywhere. this is way better. get a 30-day free trial at
10:57 am
10:58 am
all right. oh, you're going to do the poll first. okay. the results are in temporarily. we're going to keep this poll
10:59 am
open all day and we'll see what happens by "street signs" which is 2:00 eastern with a special commentary by tim cramer on tim geithner. 78% do not like timothy geithner. they say he's bad for their money. >> 78%. >> that's right. >> almost four out of five. so the polls are still open and go ahead and keep voting. unprecedented feedback. weept more and we'll focus in on this and your results at 2:30 eastern and we'll give you a total tally of how they've done it. >> i don't want to sound like a nag. >> but -- >> that address on the screen is where you go to vote. >> no www, just squawk on the >> why don't you need a www? >> i have no idea. you know, i assume you're e-mailing us because you'd like your vote to count. the problem is if you e-mail us, it doesn't count. >> we see


info Stream Only

Uploaded by TV Archive on